Gunns' trail of council debt

ELEVEN Tasmanian councils look like being among the big losers from the collapse of forest company Gunns Ltd with more than $420,000 still owing in unpaid rates.

The councils are among the 857 unsecured creditors owed more than $70 million by the former Tasmanian timber giant after it went into receivership in September.

Dorset Mayor Barry Jarvis said that the $45,258 not paid to his council would be for last year's rates.

"There would still be this year's rates outstanding so you can double whatever is there," he said.

Gunns' report to the Australian Securities and Investments Commission last Friday revealed that the Waratah- Wynyard Council stood to lose the most of the 11 councils listed as unsecured creditors, with $85,288 owing.

Central Highlands Council was owed $16,769 and George Town Council is waiting for $63,077.

PPB Advisory administrator Daniel Bryant told creditors and investors at Gunns' first creditors meeting last month that the company owed at least $709 million.

The company owes its main bankers $490 million and its former employees more than $9.7 million in holiday pay and long service leave entitlements.

Unsecured creditors said after the meeting that they did not expect to recoup any of their money.

Last week's report to ASIC provided the first detailed figures on the size of Gunns' debt and how widespread the effect of its collapse will be.

KordaMentha receiver Bryan Webster, who lodged the report, said that the information did not include estimated values of company land, sundry debtors, plant and equipment, inventory and other assets because it was commercial in confidence.

A spokesman for KordaMentha said that a call for interest in the sale of two Gunns' sawmills and their sales and distribution networks in Tasmania and Victoria closed yesterday.

He expected the successful buyer to be announced within a fortnight.

"There has been a fair degree of interest and the preference is for the bids who want to take the lot rather than split it up," he said.

Of the individual unsecured creditors listed in last week's report, Launceston-based Les Walkden Enterprises was owed the most with more than $2.8 million outstanding.

A number of medical practitioners and pharmacies are owed money for health services and a list of more than 40 superannuation funds have unpaid bills. A second creditors' meeting has been scheduled for early in the new year.